Insurance Insights for Treasury Leaders

Insurance isn’t just a safety net – it’s a core part of cash‑flow planning and risk management. If you overlook a policy gap, a single claim can wipe out months of budgeting work. That’s why every treasury professional should treat insurance like a line item on the balance sheet.

Common Gaps in Homeowners Insurance

Homeowners policies often look comprehensive, but many of them exclude flood, earthquake, and accidental water damage. These exclusions show up in the fine print, and they’re easy to miss when you’re focused on premiums. A claim for flood damage can be denied outright if your policy doesn’t list flood cover, leaving you to cover repairs out of pocket.

Another surprise is the “personal property limit” for high‑value items. Your policy might cap jewelry, art, or electronics at a fraction of their true worth. If a thief walks away with a pricey watch, you could receive far less than the loss.

How to Close Those Gaps

First, read the schedule of exclusions line by line. Ask your insurer to add a flood endorsement if you live near a river or to increase personal property limits for valuables. It usually costs a little extra, but it protects you from a big payout later.

Second, compare your coverage with a simple checklist: Do I have flood cover? Earthquake protection? Sufficient limits for personal items? If you answer no to any, request a rider or consider a separate policy.

Third, run a quick cost‑benefit test. Take the annual premium increase for added flood coverage and divide it by the potential loss you’d face without it. If the ratio looks favorable, the rider pays for itself after a few years.

Beyond homeowners, think about business interruption insurance if you manage corporate assets. A short outage can halt cash inflows, and without proper coverage you’ll have to dip into reserves. Align the limits with your average monthly revenue to keep liquidity intact during a disruption.

Regulatory changes in the UK also affect insurance requirements. The Financial Conduct Authority frequently updates guidelines on risk disclosures, and staying compliant can save you from fines. Subscribe to a trusted finance newsletter or set a quarterly reminder to review policy terms.

Finally, embed insurance reviews into your treasury calendar. Treat the policy check like a quarterly forecast meeting. When you reconfirm cash projections, also verify that your coverage limits still match the current asset values and business risk profile.

By making insurance a regular part of your financial routine, you turn a potential liability into a predictable part of your risk strategy. The effort you put in now saves you from scrambling when a claim hits, and it keeps your treasury’s bottom line healthy.